The Investor Protection Bureau of the New York Attorney General’s Office (“IPB”) recently proposed a series of changes to its rules regulating broker-dealers. The proposal would require “finders” in New York to register as broker-dealers and pass broker-dealer examinations. In doing so, IPB would codify its regulation of finders in a manner similar to several other states.…Continue Reading New York State Proposes to Regulate “Finders” as Broker-Dealers

On May 15, 2020, the U.S. Securities and Exchange Commission adopted amendments to the national market system plan governing the consolidated audit trail. The release adopts amendments to the CAT NMS Plan to address goals of increasing operational transparency and financial accountability.Continue Reading

On May 6, 2020, the U.S. Securities and Exchange Commission (“SEC”) issued an order that required equity exchanges and FINRA to submit a new National Market System (“NMS”) plan with a modernized governance structure for the production of public consolidated equity market data and the dissemination of trade and quote data. As explained in its order, the SEC hopes that a consolidation of equity market data systems will help to eliminate duplicative systems and reduce lags in data dissemination as well as data inaccuracies.…Continue Reading SEC Orders Equity Exchanges and FINRA to Modernize Consolidated Market Data

On May 4, 2020, the U.S. Securities and Exchange Commission (“SEC”) approved MEMX LLC (“MEMX”), standing for “Members Exchange,” as a new national securities exchange under Section 6 of the Securities Exchange Act of 1934. According to the MEMX website, the investors in MEMX include global financial institutions, comprised of online retail broker-dealers, global banks and financial services firms, and global market makers. MEMX will operate a fully automated electronic order book, and will not operate a physical trading floor. Similar to other national securities exchanges, only broker-dealer members of MEMX and entities that enter into market access arrangements with members will have access to the MEMX system. As a national securities exchange, MEMX will be a self-regulatory organization and will be responsible for oversight of its members.…Continue Reading SEC Approves MEMX as a new National Securities Exchange

The SEC has the authority under the Securities Exchange Act of 1934 to suspend trading in a given security if it deems it necessary for the public’s interest. It has been exercising its authority to suspend trading with increased frequency for potentially false and misleading statements made in connection with the COVID-19 pandemic. The following …

On April 9, 2020, the SEC adopted a final rule (“Final Rule”) that will amend rules for securities clearing agencies to subject all SEC-registered central counterparties (“CCPs”) and central securities depositories (“CSDs”) to enhanced standards. The adopted rules will become effective sixty days after publication in the Federal Register. (As of the date of this post, the Final Rule had not been published).

On March 30, 2020, the Securities and Exchange Commission (“SEC”) Division of Trading and Markets (“Division”) issued a No-Action Letter relating to market practices regarding bank sweep programs requested by the Securities Industry and Financial Markets Association. Specifically, the No-Action Letter provides that the Division will not recommend enforcement action for non-compliance with broker-dealer net capital requirements with respect to broker-dealers that treat certain receivables resulting from bank sweep programs as “allowable assets” for purposes of the net capital requirements.

On March 26, 2020, the Securities and Exchange Commission (“SEC”), announced two agency actions providing additional relief to market participants in response to the impacts of COVID-19 on the markets. First, the SEC adopted an interim final rule providing relief related to (a) market participants needing to gain access to make filings on the EDGAR system and (b) certain company filing obligations under Regulation A and Regulation Crowdfunding. Second, the SEC published a temporary conditional exemptive order providing relief from certain filing requirements for municipal advisors.

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